1. Main points for June to August 2015

There were 31.12 million people in work, 140,000 more than for March to May 2015 and 359,000 more than for a year earlier

There were 22.77 million people working full-time, 291,000 more than for a year earlier. There were 8.35 million people working part-time, 68,000 more than for a year earlier

The employment rate (the proportion of people aged from 16 to 64 who were in work) was 73.6%, the highest since comparable records began in 1971

There were 1.77 million unemployed people (people not in work but seeking and available to work), 79,000 fewer than for March to May 2015 and 198,000 fewer than for a year earlier

There were 970,000 unemployed men, 125,000 fewer than for a year earlier. There were 803,000 unemployed women, 73,000 fewer than for a year earlier

The unemployment rate fell to 5.4%, lower than for March to May 2015 (5.6%) and for a year earlier (6.0%). It has not been lower since March to May 2008. The unemployment rate is the proportion of the labour force (those in work plus those unemployed) who were unemployed

There were 9.01 million people aged from 16 to 64 who were economically inactive (not working and not seeking or available to work), little changed compared with March to May 2015 but down slightly (13,000) compared with a year earlier

The inactivity rate (the proportion of people aged from 16 to 64 who were economically inactive) was 22.1%, little changed compared with March to May 2015 and with a year earlier

Comparing June to August 2015 with a year earlier, pay for employees in Great Britain increased by 3.0% including bonuses and by 2.8% excluding bonuses

2. Summary of latest labour market statistics

Table A shows the latest estimates, for June to August 2015, for employment, unemployment and economic inactivity. It shows how these estimates compare with the previous quarter (March to May 2015) and the previous year (June to August 2014). Comparing June to August 2015 with March to May 2015 provides the most robust short-term comparison. Making comparisons with earlier data at Section (ii) has more information.

Table A: Summary of UK labour market statistics for June to August 2015, seasonally adjusted

Number (thousands)

Change on Mar to May 2015

Change on Jun to Aug 2014

Headline Rate (%)

Change on Mar to May 2015

Change on Jun to Aug 2014

Employed

31,122

140

359

Aged 16 to 64

29,966

114

313

73.6

0.2

0.6

Aged 65 and over

1,156

26

46

Unemployed

1,774

-79

-198

5.4

-0.3

-0.6

Aged 16 to 64

1,749

-85

-203

0.0

Aged 65 and over

25

5

5

Inactive

19,098

21

170

Aged 16 to 64

9,015

-4

-13

22.1

-0.1

Aged 65 and over

10,083

26

183

Source: Office for National Statistics

Notes:

1. Calculation of headline employment rate: Number of employed people aged from 16 to 64 divided by the population aged from 16 to 64. Population is the sum of employed plus unemployed plus inactive

2. Calculation of headline unemployment rate: Number of unemployed people aged 16 and over divided by the sum of employed people aged 16 and over plus unemployed people aged 16 and over

3. Calculation of headline economic inactivity rate: Number of economically inactive people aged from 16 to 64 divided by the population aged from 16 to 64. Population is the sum of employed plus unemployed plus inactive

A Glossary which explains the terms used within labour market statistics is also available.

About labour market statuses

Everybody aged 16 or over is either employed, unemployed or economically inactive. The employment estimates include all people in work including those working part-time. People not working are classed as unemployed if they have been looking for work within the last 4 weeks and are able to start work within the next 2 weeks. A common misconception is that the unemployment statistics are a count of people on benefits; this is not the case as they include unemployed people not claiming benefits.

Jobless people who have not been looking for work within the last 4 weeks or who are unable to start work within the next 2 weeks are classed as economically inactive. Examples of economically inactive people include people not looking for work because they are students, looking after the family or home, because of illness or disability or because they have retired.

Making comparisons with earlier data derived from the Labour Force Survey

Estimates of employment, unemployment, economic inactivity, hours worked and redundancies are derived from the Labour Force Survey (LFS), a survey of households. The most robust estimates of short-term movements in these estimates are obtained by comparing the estimates for June to August 2015 with the estimates for March to May 2015, which were first published on 15 July 2015. This provides a more robust estimate than comparing with the estimates for May to July 2015. This is because the June and July data are included within both estimates, so effectively observed differences are those between the individual months of May and August 2015. The LFS is sampled such that it is representative of the UK population over a 3 month period, not for single month periods.

Accuracy and reliability of survey estimates

Most of the figures in this statistical bulletin come from surveys of households or businesses. Surveys gather information from a sample rather than from the whole population. The sample is designed carefully to allow for this, and to be as accurate as possible given practical limitations such as time and cost constraints, but results from sample surveys are always estimates, not precise figures. This means that they are subject to a margin of error which can have an impact on how changes in the numbers should be interpreted, especially in the short-term.

Changes in the numbers reported in this statistical bulletin (and especially the rates) between 3 month periods are usually not greater than the margin of error. In practice, this means that small, short-term movements in reported rates (for example within +/- 0.3 percentage points) should be treated as indicative, and considered alongside medium and long-term patterns in the series and corresponding movements in administrative sources, where available, to give a fuller picture.

Further information is available towards the end of this statistical bulletin in the section Accuracy of the statistics: estimating and reporting uncertainty.

Seasonal adjustment

All estimates discussed in this statistical bulletin are seasonally adjusted except where otherwise stated. Like many economic indicators, the labour market is affected by factors that tend to occur at around the same time every year; for example school leavers entering the labour market in July and whether Easter falls in March or April. In order to compare movements other than annual changes in labour market statistics, such as since the previous quarter or since the previous month, the data are seasonally adjusted to remove the effects of seasonal factors and the arrangement of the calendar.

Other labour market statistics

5. Employment

Introduction

Employment measures the number of people in work and differs from the number of jobs because some people have more than one job. Further information is available at Notes for Employment at the end of this section.

Commentary

The proportion of people aged from 16 to 64 in work is known as the employment rate. Figure 1.1 shows the employment rate for people aged from 16 to 64 since comparable records began in 1971. The lowest employment rate was 65.6% in 1983, during the economic downturn of the early 1980s. The employment rate has been generally increasing since early 2012 and for the latest time period, June to August 2015, it reached a record high of 73.6%.

Figure 1.2: UK Employment rate (aged 16 to 64), seasonally adjusted

June to August 2010 to June to August 2015

Source: Labour Force Survey - Office for National Statistics

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For June to August 2015, 73.6% of people aged from 16 to 64 were in work. This was:

higher than for March to May 2015 (73.3%)

higher than for a year earlier (73.0%)

higher than the pre-downturn peak recorded for early 2008 (73.0%)

the highest since comparable records began in 1971

Looking at employment rates by sex, for June to August 2015:

78.4% of men and 68.8% of women aged from 16 to 64 were in work

employment rates for both men and women were higher than for March to May 2015 and for a year earlier

the employment rate for men (78.4%) was lower than before the economic downturn of 2008 to 2009, when it peaked at 79.1% in late 2007 to early 2008

the employment rate for women (68.8%) was the joint highest since comparable records began in 1971, partly due to ongoing changes to the state pension age for women resulting in fewer women retiring between the ages of 60 and 65

For June to August 2015, there were 31.12 million people in work, 140,000 more than for March to May 2015 and 359,000 more than for a year earlier.

Comparing the estimates for full-time and part-time employment by sex for June to August 2015 with those for a year earlier:

men working full-time increased by 163,000 to 14.37 million

men working part-time increased by 47,000 to 2.20 million

women working full-time increased by 128,000 to 8.40 million

women working part-time increased by 21,000 to 6.15 million

Figure 1.3: Changes in people in employment in the UK between June to August 2014 and June to August 2015, seasonally adjusted

Where to find data about employment

Estimates for the number of people in employment and for the number of self-employed people back to 1855 (which do not have National Statistics status) have been published by the Bank of England in the spreadsheet Three centuries of macroeconomic data v2.2 (at columns H and N in worksheet 22).

Notes for Employment

Employment consists of employees, self-employed people, unpaid family workers and people on government supported training and employment programmes

Unpaid family workers are people who work in a family business who do not receive a formal wage or salary but benefit from the profits of that business

The government supported training and employment programmes series does not include all people on these programmes; it only includes people engaging in any form of work, work experience or work-related training who are not included in the employees or self-employed series. People on these programmes NOT engaging in any form of work, work experience or work-related training are not included in the employment estimates; they are classified as unemployed or economically inactive

6. Public and private sector employment (first published on 16 September 2015)

Introduction

Public sector employment measures the number of people in paid work in the public sector. The public sector comprises central government, local government and public corporations. Estimates of public sector employment are obtained from information provided by public sector organisations.

Private sector employment is estimated as the difference between total employment, sourced from the Labour Force Survey, and public sector employment.

Comparisons of public and private sector employment over time are impacted by changes to the composition of these sectors. For example, if a publicly owned body is privatised, public sector employment will fall and private sector employment will increase by an equivalent amount. This is known as a reclassification effect. At Table 4 of the pdf version of this statistical bulletin and at data table EMP02 (48 Kb Excel sheet) we therefore publish estimates of public and private sector employment excluding the effects of major, but not all, reclassifications alongside estimates of total public and private sector employment.

Commentary

There were 5.36 million people employed in the public sector for June 2015. This was:

down 16,000 from March 2015

down 59,000 from a year earlier

the lowest figure since comparable records began in 1999

There were 25.74 million people employed in the private sector for June 2015. This was 58,000 more than for March 2015 and 472,000 more than for a year earlier.

For June 2015, 17.2% of people in employment worked in the public sector (the lowest proportion since comparable records began in 1999) and the remaining 82.8% worked in the private sector.

Figure 2.1 shows public sector employment as a percentage of all people in employment for the last 5 years.

Figure 2.1: UK public sector employment as a percentage of total UK employment, seasonally adjusted

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The number of people employed in the public sector has been generally falling since March 2010. Quarterly estimates of public and private sector employment are available back to 1999. Comparisons of public and private sector employment over time are complicated by several large employers moving between the public and private sectors. We therefore publish estimates of public and private sector employment excluding the effects of major reclassifications alongside estimates of total public and private sector employment at Table 4 of the pdf version of this statistical bulletin and at data table EMP02 (48 Kb Excel sheet).

7. Employment by nationality and country of birth, not seasonally adjusted (first published on 12 August 2015)

Introduction

The estimates of employment by both nationality and country of birth relate to the number of people in employment rather than the number of jobs. Changes in the series therefore show net changes in the number of people in employment, not the proportion of new jobs that have been filled by UK and non-UK workers. These estimates should not be used as a proxy for flows of foreign migrants into the UK.

The estimates are not seasonally adjusted and it is therefore best practice to compare the estimates for April to June 2015 with those for a year earlier rather than with those for January to March 2015.

Commentary

Looking at the estimates by nationality, between April to June 2014 and April to June 2015:

UK nationals working in the UK increased by 84,000 to 27.76 million

non-UK nationals working in the UK increased by 257,000 to 3.18 million

Looking at changes in non-UK nationals working in the UK between April to June 1997 and April to June 2015:

the number of non-UK nationals working in the UK increased from 966,000 to 3.18 million

the proportion of all people working in the UK accounted for by non-UK nationals increased from 3.7% to 10.3%

this increase in non-UK nationals working in the UK reflects the admission of several new member states to the European Union (EU)

Looking in more detail at non-UK nationals working in the UK, between April to June 2014 and April to June 2015:

non-UK nationals from the EU working in the UK increased by 250,000 to 1.98 million

non-UK nationals from outside the EU working in the UK was little changed at 1.20 million

Figure 3.1 shows the number of non-UK nationals from EU and non-EU countries working in the UK from April to June 1997 to April to June 2015.

Figure 3.1: Non-UK nationals working in the UK, not seasonally adjusted

April to June 1997 to April to June 2015

Source: Labour Force Survey - Office for National Statistics

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As shown in Figure 3.1, since January to March 2009, the number of non-UK nationals from outside the EU working in the UK has been broadly flat but the number of non-UK nationals from EU countries working in the UK has continued to increase.

For April to June 2015, there were 4.99 million people born abroad working in the UK, but the number of non-UK nationals working in the UK was much lower at 3.18 million. This is because the estimates for people born abroad working in the UK include some UK nationals. Looking at the estimates by country of birth, between April to June 2014 and April to June 2015:

UK born people working in the UK increased by 126,000 to 25.94 million

non-UK born people working in the UK increased by 207,000 to 4.99 million

Where to find data about employment by nationality and country of birth

8. Actual hours worked

Introduction

Actual hours worked measures the number of hours worked in the economy. Changes in actual hours worked reflect changes in the number of people in employment and the average hours worked by those people.

Commentary

Total hours worked per week were 996.1 million for June to August 2015. This was:

0.5 million (0.1%) more than for March to May 2015

8.8 million (0.9%) more than for a year earlier

71.2 million (7.7%) more than for 5 years previously

Figure 4.1 shows total hours worked for the last 5 years.

Figure 4.1: Total hours worked per week in the UK, seasonally adjusted

Where to find data about hours worked

Estimates for average weekly hours worked back to 1855 (which do not have National Statistics status) have been published by the Bank of England in the spreadsheet Three centuries of macroeconomic data v2.2 (at column Q in worksheet 22).

9. Workforce jobs (first published on 16 September 2015)

Introduction

Workforce jobs measures the number of filled jobs in the economy. The estimates are mainly sourced from employer surveys. Workforce jobs is a different concept from employment, which is sourced from the Labour Force Survey, as employment is an estimate of people and some people have more than one job.

Commentary

For June 2015 there were 33.69 million workforce jobs, 102,000 more than for March 2015 and 330,000 more than for a year earlier. Figure 5.1 shows changes in the number of jobs by industrial sector between June 2014 and June 2015.

Figure 5.1: Changes in the number of jobs in the UK between June 2014 and June 2015, seasonally adjusted

Source: Office for National Statistics

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Looking at a longer term comparison, between June 1978 (when comparable records began) and June 2015:

the proportion of jobs accounted for by the manufacturing and mining and quarrying sectors fell from 26.4% to 8.0%

the proportion of jobs accounted for by the services sector increased from 63.2% to 83.5%

While comparable estimates for workforce jobs by industry begin in 1978, some historical information back to 1841, not comparable with the latest estimates, are available from 2011 Census Analysis, 170 years of industry.

10. Average weekly earnings

Introduction

Average Weekly Earnings measures money paid to employees in Great Britain in return for work done, before tax and other deductions from pay. The estimates do not include earnings of self-employed people. Estimates are available for both total pay (which includes bonuses) and for regular pay (which excludes bonus payments). The estimates are not just a measure of pay settlements as they also reflect compositional changes within the workforce. Further information is available at Notes for Earnings at the end of this section.

Commentary

For August 2015:

average regular pay (excluding bonuses) for employees in Great Britain was £463 per week before tax and other deductions from pay

average total pay (including bonuses) for employees in Great Britain was £494 per week before tax and other deductions from pay

Between June to August 2014 and June to August 2015 in nominal terms (that is, not adjusted for consumer price inflation):

total pay for employees in Great Britain increased by 3.0%

regular pay for employees in Great Britain increased by 2.8%

Figure 6.1 compares the annual growth rates for both regular and total pay in nominal terms for the last 5 years.

June to August 2010 to June to August 2015

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Looking at longer term movements, since comparable records began in 2000 average total pay for employees in Great Britain in nominal terms (that is, not adjusted for consumer price inflation) increased from £311 a week in January 2000 to £494 a week in August 2015; an increase of 58.6%. Over the same period the Consumer Prices Index increased by 39.4%.

Between June to August 2014 and June to August 2015 in real terms (that is, adjusted for consumer price inflation):

While comparable records for average weekly earnings start in 2000, modelled estimates back to 1963 (which do not have National Statistics status) are available at data table EARN02 (549 Kb Excel sheet).

Notes for Average Weekly Earnings

The estimates relate to Great Britain and include salaries but not unearned income, benefits in kind or arrears of pay

As well as pay settlements, the estimates reflect bonuses, changes in the number of paid hours worked and the impact of employees paid at different rates joining and leaving individual businesses. The estimates also reflect changes in the overall structure of the workforce; for example, fewer low paid jobs in the economy would have an upward effect on the earnings growth rate

Lloyds Banking Group plc is reclassified to the private sector from April 2014 following the sale of some government owned shares to private sector investors. It is classified to the public sector between July 2009 and March 2014. We estimate that, if the April 2014 reclassification had not occurred, the public sector single month growth rates between April 2014 and March 2015 would have been around 0.3 percentage points higher and the corresponding private sector growth rates would have been around 0.1 percentage points lower

Figure 7.1 shows cumulative 12 month totals for working days lost for the last 5 years.

Figure 7.1: Working days lost in the UK cumulative 12 months totals, not seasonally adjusted

August 2010 to August 2015

Source: Labour Disputes Statistics - Office for National Statistics

Notes:

The figures from November 2011 to October 2012 and from July 2014 to June 2015 are affected by one day strikes on 30 November 2011 and 10 July 2014 relating to changes to pension schemes and pay for some public sector workers

Where to find more information about labour disputes

12. Unemployment

Introduction

Unemployment measures people without a job who have been actively seeking work within the last 4 weeks and are available to start work within the next 2 weeks.

Commentary

The unemployment rate is not the proportion of the total population who are unemployed. It is the proportion of the economically active population (those in work plus those seeking and available to work) who are unemployed. This follows guidelines specified by the International Labour Organisation and it ensures that UK unemployment rates are broadly comparable with those published by other countries.

Figure 8.1 shows that the lowest unemployment rate recorded since comparable records began in 1971 was 3.4% in late 1973 to early 1974 and the highest rate, 11.9%, was recorded in 1984 during the downturn of the early 1980s. The unemployment rate for the latest time period, June to August 2015, was 5.4%.

June to August 2010 to June to August 2015

Source: Labour Force Survey - Office for National Statistics

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The unemployment rate for those aged 16 and over for June to August 2015 was 5.4%. This was:

down from 5.6% for March to May 2015

down from 6.0% for a year earlier

higher than the pre-downturn trough of 5.2% for late 2007 to early 2008

For June to August 2015, there were 1.77 million unemployed people. This was 79,000 fewer than for March to May 2015 and 198,000 fewer than for a year earlier.

Looking at unemployment by sex for June to August 2015, there were:

970,000 unemployed men, 44,000 fewer than for March to May 2015 and 125,000 fewer than for a year earlier

803,000 unemployed women, 36,000 fewer than for March to May 2015 and 73,000 fewer than for a year earlier

Looking at unemployment by how long people have been out of work and seeking work, for June to August 2015 there were:

958,000 people who had been unemployed for up to 6 months, 24,000 fewer than for March to May 2015 but 14,000 more than for a year earlier

290,000 people who had been unemployed for between 6 and 12 months, 11,000 fewer than for March to May 2015 and 27,000 fewer than for a year earlier

526,000 people who had been unemployed for over 12 months, 44,000 fewer than for March to May 2015 and 185,000 fewer than for a year earlier

Looking at international comparisons, the unemployment rate for the European Union (EU) was 9.5% of the economically active population for August 2015. Within the EU:

the highest unemployment rates were for Greece (25.2% for June 2015) and Spain (22.2% for August 2015)

the lowest unemployment rate was for Germany (4.5% for August 2015)

apart from Germany, only the Czech Republic (5.0% for August 2015) and Malta (5.1% for August 2015) had lower unemployment rates than the UK

The unemployment rate for the United States was 5.1% for both August and September 2015.

Figure 8.3 shows the unemployment rates for the UK, the EU and the United States (US) for the last 5 years. It shows that the unemployment rate for the UK has been substantially lower than that for the whole of the EU. The unemployment rate for the US has moved in a downward direction since early 2010 and the UK unemployment rate has been generally falling since early 2012. For the most recent time periods the unemployment rates for the UK and the US have been similar. However, for April to June 2015, the employment rate for those aged from 16 to 64 for the UK (73.4%) was higher than that for the US (68.7%).

Figure 8.3: Unemployment rates for the United Kingdom, European Union and United States, seasonally adjusted

August 2010 to August 2015

Source: Labour Force Survey - Office for National Statistics

Notes:

The unemployment rates for the UK and the United States are for those aged 16 and over. The unemployment rate for the EU is for those aged from 15 to 74

Figure 8.3 shows monthly estimates for the EU and for the United States from August 2010 to August 2015 and 3 month average estimates for the UK from June to August 2010 to June to August 2015

Where to find data about unemployment

Estimates for the unemployment level and rate back to 1870 (which do not have National Statistics status) have been published by the Bank of England in the spreadsheet Three centuries of macroeconomic data v2.2 (at columns P and U in worksheet 22).

13. Claimant Count (experimental statistics)

Introduction

The Claimant Count measures the number of people claiming unemployment related benefits:

between January 1971 (when comparable estimates start) and September 1996 it is an estimate of the number of people who would have claimed unemployment related benefits if the current benefit system had existed at that time

between October 1996 and April 2013 the Claimant Count is a count of the number of people claiming Jobseeker’s Allowance (JSA)

between May 2013 and October 2013 the Claimant Count includes all claimants of Universal Credit (including those who were in work) as well as all JSA claimants

from November 2013 the Claimant Count includes all out of work Universal Credit claimants as well as all JSA claimants

Ideally only those Universal Credit claimants who are out of work and required to seek work should be included in the Claimant Count but it is not currently possible to produce estimates on this basis. The Claimant Count therefore currently includes some out of work claimants of Universal Credit who are not required to look for work; for example, due to illness or disability.

The Claimant Count estimates are currently designated as experimental statistics because the Universal Credit estimates are still being developed by the Department for Work and Pensions. However the Claimant Count estimates do provide the best available estimates of the number of people claiming unemployment related benefits in the UK.

The Claimant Count includes people who claim unemployment related benefits but who do not receive payment. For example some claimants will have had their benefits stopped for a limited period of time by Jobcentre Plus. Some people claim JSA in order to receive National Insurance Credits.

Commentary

Figure 9.1 shows the Claimant Count since comparable records began in 1971. It shows that the lowest number of people claiming unemployment related benefits was 422,600 in December 1973 and the highest figure was 3.09 million in July 1986. For the latest month, September 2015, there were 796,200 people claiming unemployment related benefits.

Figure 9.1: UK Claimant Count, seasonally adjusted

January 1971 to September 2015

Source: Office for National Statistics, Department for Work and Pensions

Where to find data about the Claimant Count

While comparable records start in 1971, some data back to 1881 (which do not have National Statistics status) are available from the “Historic Data” worksheet within data table CLA01 (277.5 Kb Excel sheet).

14. Comparison between unemployment and the Claimant Count

without a job, have actively sought work in the last 4 weeks and are available to start work in the next 2 weeks

out of work, have found a job and are waiting to start it in the next 2 weeks

People who meet these criteria are classified as unemployed irrespective of whether or not they claim Jobseeker’s Allowance (JSA) or other benefits. The estimates are derived from the Labour Force Survey and are published for 3 month average time periods.

The Claimant Count measures the number of people claiming unemployment related benefits. As explained at Section 9 of this statistical bulletin, the Claimant Count estimates are designated as experimental statistics. In this section of the bulletin we compare quarterly movements in unemployment with quarterly movements in the Claimant Count. Some claimants will not be classified as unemployed. For example, people in employment working fewer than 16 hours a week can be eligible to claim JSA depending on their income.

Figure 10.1 and the associated spreadsheet compare quarterly movements in unemployment and the Claimant Count for the same 3 month average time periods. The unemployment estimates shown in this comparison exclude unemployed people in the 16 to 17 and 65 and over age groups as well as unemployed people aged from 18 to 24 in full-time education. This provides a more meaningful comparison with the Claimant Count than total unemployment because people in these population groups are not usually eligible to claim JSA.

When 3 month average estimates for the Claimant Count are compared with unemployment estimates for the same time periods and for the same population groups (people aged from 18 to 64 excluding 18 to 24 year olds in full-time education), between March to May 2015 and June to August 2015:

unemployment fell by 51,000

the Claimant Count fell by 7,000

Figure 10.1: Quarterly changes in Unemployment and the Claimant Count for the UK (aged 18 to 64), seasonally adjusted

June to August 2010 to June to August 2015

Source: Office for National Statistics, Department for Work and Pensions

Notes:

Unemployment estimates are sourced from the Labour Force Survey (a survey of households). The unemployment figures in this chart, and the associated spreadsheet, exclude unemployed people aged from 18 to 24 in full-time education

Claimant Count estimates are sourced from administrative data from Jobcentre Plus (part of the Department for Work and Pensions)

Download this chart

15. Economic inactivity

Introduction

Economically inactive people are not in employment but do not meet the internationally accepted definition of unemployment because they have not been seeking work within the last 4 weeks and/or they are unable to start work within the next 2 weeks.

Commentary

The proportion of people, aged from 16 to 64, not in work and neither seeking nor available to work is known as the economic inactivity rate. Figure 11.1 shows the economic inactivity rate for people aged from 16 to 64 since comparable records began in 1971.

Figure 11.1 shows that the economic inactivity rate increased during the downturn of the early 1980s reaching a record high of 25.9% in 1983. As the economy improved in the late 1980s, the economic inactivity rate resumed its downward path, reaching a record low of 21.7% in late 1989 and 1990, before the economic downturn of the early 1990s drove it back up again. Following an increase in the economic inactivity rate during the economic downturn of 2008 to 2009, it resumed its generally downward path.

June to August 2010 to June to August 2015

Source: Labour Force Survey - Office for National Statistics

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The economic inactivity rate for those aged from 16 to 64 for June to August 2015 was 22.1%. This was little changed compared with March to May 2015 and with a year earlier.

For June to August 2015, there were 9.01 million people aged from 16 to 64 not in work and neither seeking nor available to work (known as economically inactive), little changed compared with March to May 2015 but 13,000 fewer than for a year earlier.

Looking in more detail at the 9.01 million people aged from 16 to 64 who were economically inactive for June to August 2015, the 2 largest categories were students and people looking after the family or home (each of which accounted for just over a quarter of the total):

there were 2.32 million people who were not looking for work because they were studying, 13,000 more than for March to May 2015 but 31,000 fewer than for a year earlier

there were 2.26 million people (of which 2.02 million were women) who were not looking for work because they were looking after the family or home, little changed compared with March to May 2015 and with a year earlier

The third and fourth largest categories were long-term sick (around 23% of the total) and retired (around 14% of the total):

there were 2.10 million people who were not looking for work due to long-term sickness, 28,000 more than for March to May 2015 and 81,000 more than for a year earlier

there were 1.23 million people who were not looking for work because they had retired, 39,000 fewer than for March to May 2015 and 88,000 fewer than for a year earlier, partly due to ongoing changes to the state pension age for women resulting in fewer women retiring between the ages of 60 and 65

16. Young people in the labour market

Introduction

It is a common misconception that all people in full-time education are classified as economically inactive. This is not the case as people in full-time education are included in the employment estimates if they have a part-time job and are included in the unemployment estimates if they are seeking part-time work.

Commentary

For June to August 2015, for people aged from 16 to 24, there were:

3.92 million people in work (including 944,000 full-time students with part-time jobs)

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Figure 12.2 shows how the latest estimates, for June to August 2015, for employment, unemployment and economic inactivity for people aged from 16 to 24 compare with the previous quarter (March to May 2015) and the previous year (June to August 2014).

Figure 12.2: Changes in the number of young people (aged 16 to 24) in the UK labour market, seasonally adjusted

Source: Labour Force Survey - Office for National Statistics

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For June to August 2015, the unemployment rate for 16 to 24 year olds was 14.8%. This was:

lower than for March to May 2015 (15.9%)

lower than for a year earlier (16.0%)

higher than the pre-downturn trough of 13.8% for the 3 months ending February 2008

The unemployment rate for those aged from 16 to 24 has been consistently higher than that for older age groups. Since comparable records began in 1992:

the lowest youth unemployment rate was 11.6% for March to May 2001

the highest youth unemployment rate was 22.5% for late 2011

For March to May 1992 (when comparable records began) 26.2% of people aged from 16 to 24 were in full-time education. By June to August 2015 this proportion had increased substantially to 44.5%. More young people going into full-time education reduces the size of the economically active population (those in work plus those seeking and available to work) and therefore increases the unemployment rate (because the unemployment rate is the proportion of the economically active population who are unemployed).

Looking at international comparisons, the youth unemployment rate (for those aged from 15 to 24) for the European Union (EU) was 20.4% for August 2015. Within the EU, the highest youth unemployment rates were for Spain (48.8% for August 2015) and for Greece (48.3% for June 2015). The lowest youth unemployment rates were for Germany (7.0% for August 2015) and Austria (10.8% for August 2015). These EU youth unemployment rates were published in a Eurostat news release on 30 September 2015.

19. Main out of work benefits, not seasonally adjusted (first published on 12 August 2015)

Introduction

Main out of work benefits includes claimants of unemployment related benefits and Employment and Support Allowance and other incapacity benefits. It also includes claimants of Income Support and Pension Credit. While most people claiming these benefits are out of work a small number are in employment. These estimates exclude claimants in Northern Ireland.

The estimates are not seasonally adjusted and it is therefore best practice to compare the estimates for February 2015 with those for a year earlier rather than with those for November 2014.

Commentary

For February 2015 there were 3.94 million people claiming main out of work benefits. This was:

329,700 fewer than for February 2014

1.16 million fewer than the peak of 5.10 million recorded for February 2010

For February 2015, 9.9% of the population aged from 16 to 64 were claiming main out of work benefits. This was down from 10.7% for a year earlier.

Figure 15.1 shows, for the last 5 years, the proportion of the population aged from 16 to 64 claiming main out of work benefits.

Figure 15.1: Proportion of Great Britain population (aged 16 to 64) claiming main out of work benefits, not seasonally adjusted

February 2010 to February 2015

Source: Department for Work and Pensions, Office for National Statistics

Methodological articles

21. Revisions

Estimates for the most recent time periods are subject to revision due to the receipt of late and corrected responses to business surveys and revisions to seasonal adjustment factors which are re-estimated every month. Estimates are subject to longer run revisions, on an annual basis, resulting from reviews of the seasonal adjustment process. Estimates derived from the Labour Force Survey (a survey of households) are usually only revised once a year. Revisions to estimates derived from other sources are usually minor and are commented on in the statistical bulletin if this is not the case. Further information is available in the labour market statistics revisions policy (36.7 Kb Pdf).

22. Accuracy of the statistics: estimating and reporting uncertainty

Most of the figures in this statistical bulletin come from surveys of households or businesses. Surveys gather information from a sample rather than from the whole population. The sample is designed to allow for this, and to be as accurate as possible given practical limitations such as time and cost constraints, but results from sample surveys are always estimates, not precise figures. This means that they are subject to some uncertainty. This can have an impact on how changes in the estimates should be interpreted, especially for short-term comparisons.

We can calculate the level of uncertainty (also called “sampling variability”) around a survey estimate by exploring how that estimate would change if we were to draw many survey samples for the same time period instead of just one. This allows us to define a range around the estimate (known as a “confidence interval”) and to state how likely it is in practice that the real value that the survey is trying to measure lies within that range. Confidence intervals are typically set up so that we can be 95% sure that the true value lies within the range – in which case we refer to a “95% confidence interval”.

For example, the unemployment rate for June to August 2015 was estimated to be 5.4%. This figure had a stated 95% confidence interval of +/- 0.2 percentage points. This means that we can be 95% certain that the true unemployment rate for June to August 2015 was between 5.2% and 5.6%. However, the best estimate from the survey was that the unemployment rate was 5.4%.

The number of people unemployed for the same period was estimated at 1,774,000, with a stated 95% confidence interval of +/- 76,000. This means that we can be 95% sure that the true number of unemployed people was between 1,698,000 and 1,850,000. Again, the best estimate from the survey was that the number of unemployed people was 1,774,000.

As well as calculating precision measures around the numbers and rates obtained from the survey, we can also calculate them for changes in the numbers. For example, for June to August 2015, the estimated change in the number of unemployed people since March to May 2015 was a fall of 79,000, with a 95% confidence interval of +/- 81,000. This means that we can be 95% certain the actual change in unemployment was somewhere between an increase of 2,000 and a fall of 160,000, with the best estimate being a fall of 79,000. As the estimated fall in unemployment of 79,000 is slightly smaller than the confidence interval of 81,000, the estimated increase in unemployment is said to be “not statistically significant”.

Working with uncertain estimates

In general, changes in the numbers (and especially the rates) reported in this statistical bulletin between 3 month periods are small, and are not usually greater than the level that is explainable by sampling variability. In practice, this means that small, short-term movements in reported rates (for example within +/- 0.3 percentage points) should be treated as indicative, and considered alongside medium and long-term patterns in the series and corresponding movements in administrative sources, where available, to give a fuller picture.

Seasonal adjustment and uncertainty

Like many economic indicators, the labour market is affected by factors that tend to occur at around the same time every year; for example school leavers entering the labour market in July and whether Easter falls in March or April. In order to compare movements other than annual changes in labour market statistics, such as since the previous quarter or since the previous month, the data are seasonally adjusted to remove the effects of seasonal factors and the arrangement of the calendar. All estimates discussed in this statistical bulletin are seasonally adjusted except where otherwise stated. While seasonal adjustment is essential to allow for robust comparisons through time, it is not possible to estimate uncertainty measures for the seasonally adjusted series.

24
.Background notes

This month's release

There have been revisions to estimates of Average Weekly Earnings (AWE) back to the start of the time series in 2000 resulting from the annual review of the seasonal adjustment process. There have been further revisions to the AWE resulting from updating the estimates of earnings growth for companies employing fewer than 20 people based on taking on board the latest data from the Annual Survey of Hours and Earnings. Further information is available in an article on the labour market articles and reports page on our website.

Next month’s release

Since July 2015 we have published estimates of real earnings (that is, adjusted for consumer price inflation) in an article accompanying this statistical bulletin and at data table X04 (145 Kb Excel sheet). In next month’s release we will introduce a new table in the pdf version of this statistical bulletin, and at data table A01 (3 Mb Excel sheet), showing the headline whole economy earnings estimates for total pay and regular pay in both nominal and real terms. This should make it easier for you to compare nominal and real earnings growth rates.

There will be minor revisions to out of work benefit proportions published at Table 11 of the pdf version of this statistical bulletin and at data table BEN01 (59.5 Kb Excel sheet) resulting from taking on board the latest population estimates.

Experimental Statistics: Claimant Count estimates

Experimental statistics are not yet fully developed. Estimates of the Claimant Count, published at Table 10 of the pdf version of this statistical bulletin and at data table CLA01 (277.5 Kb Excel sheet), are the only series in this statistical bulletin designated as experimental statistics.

The Claimant Count estimates have been designated as experimental statistics since June 2015 because they include estimates of Universal Credit which are still being developed by the Department for Work and Pensions. An article on our website (110.6 Kb Pdf) explains the changes made to the Claimant Count in the June 2015 edition of this statistical bulletin.

The United Kingdom Statistics Authority has designated these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics.

Designation can be broadly interpreted to mean that the statistics:

meet identified user needs

are well explained and readily accessible

are produced according to sound methods

are managed impartially and objectively in the public interest

Once statistics have been designated as National Statistics it is a statutory requirement that the Code of Practice shall continue to be observed.